UPDATE 1-Canada Q4 household debt-to-income ratio hits record

OTTAWA, March 12 (Reuters) - Canada's household
debt-to-income ratio rose to a record high in the final quarter
of 2014, hitting 163.3 percent from 162.7 percent in the
previous quarter, Statistics Canada said on Thursday.

It was the third quarter in a row that disposable income
increased at a slower rate than household credit market debt.
The ratio is not seasonally adjusted.

The Bank of Canada watches the measure closely for signs
consumers may be overextended.

The central bank said in its January monetary policy report
that household imbalances remain elevated and are expected to
edge up in the near term as house prices and resale activity
continue to see strength in some regions.

The debt-service ratio, or interest paid as a proportion of
disposable income, edged up to 6.8 percent, though the ratio has
hovered around an all-time low for the past three quarters.

The Bank of Canada cut interest rates to 0.75 percent in
January, which means debt burdens will likely get easier, though
some economists have argued that cheaper rates could prompt
Canadians to stretch themselves too thin.

National net worth rose 2.6 percent from the third quarter
to hit C$8.27 trillion ($6.51 trillion).